Credit cards for the financially clueless

Credit cards for the financially clueless

Offering credit cards to the financially clueless at first seems to be an unnecessarily cruelty: like offering a weight watchers dieter an extra portion of whatever you're having it seems likely to end in tears.

However, there's method behind the madness. How often, as a personal finance writer, do I hear this sentence: oh I'm hopeless with money.

Answer: very often. Being financially clueless is often worn as a badge of honour exempting the wearer from any blame when something goes wrong with their finances, no matter how complex the product that they were trying to use was or how simple their mistake.

All I'm saying is: take a few simple steps to stop those problems from happening in the first place by accepting your financial problems and you'll stop losing money hand over fist.

The first thing to do is to do a credit card comparison of the market to find the deals that you really need.

If you're financially clueless just use one credit card for one thing. Think of it as a tool that only has one use: if you have more than one thing to do then you need a different tool to do it with.

Doing more than one thing with a credit card at a time could have disastrous consequences.

For example, spending on 0% balance transfer credit cards could have disastrous consequences because of the way that payment are usually allocated it could lead to you paying a lot of interest without actually needing to in the first place.

Having said that, if you already have a credit card debt that is accumulating interest at a high rate, though, an offer with a 0% period can be simplest way to get rid of the debt.

The second point is that having a credit card requires a certain amount of budgeting.

Make sure that you can pay off at least the minimum by direct debit to avoid charges being applied to your account and bear in mind that any 0% offers could be withdrawn if you don't make that minimum payment at the very least.

A word to the clueless, however, hope is not lost. If you have a big problem with budgeting that means that you may not have paid off the debt within the allotted time slot you'd be far better off going with a life of balance transfer credit card which simply keeps the debt at a low rate until you've paid it off in full.

Finally, you can increase the chance of you finishing an application by going for instant decision credit cards to cut down on paperwork. Just make sure you're eligible first.

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